Capital gains on inherited property

kdurh · Joined: 15 Sep 2008 Posts: 1 1.30 Dollars($)

I inherited 1/2 of 45 acres in 1998 from my father and my mother inherited the other half in trust. She revoked the trust in 2001 and the land went to me. It was appraised in 2001 for 144000. Now I am selling it for 225000. My taxable income for myself and husband will be approximated 55000 in 2008. I live in VA. What will be my tax for the sale of this property. Will this be a "zero" tax???

helping_user · Posted: Tue Sep 16, 2008 2:21 am Post subject:

Welcome kdurh.

You need to find out the stepped-up basis or fair market value of property when you inherited it from your mother This value needs to be adjusted with any improvement done on the property. The capital gains can then be calculated as given at http://www.mortgagefit.com/discuss/about1892.html#6527 .

Regarding the zero tax issue, you may take the advice of a tax consultant.

Thanks.

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